A previous no-fault claim has resulted in a $65 increase to my new insurance policy. Is it normal practice for insurance companies to penalise you for existing no-fault claims?
No-Fault Insurance Claim Affects Future Premium?
rickb on 07/01/2022 - 12:56
Comments
I did not disclose the no-fault claim when I requested the quote. That came out later when I was online with the insurance company. This resulted in an increase.
You'll find that quotes via the phone and quotes online don't often match even if you use exactly the same info. Things like whether it's a policy renewal or a brand new policy also impact premium amounts.
A no-fault claim theoretically doesn't impact your premium, but from a risk perspective, the likelihood of you making a claim does increase. Especially if you have a few of them.
Find an insurer that asks only about at-fault claims and you can be confident that you're premium doesn't take into account your no-fault claim.
curious does phone or online quote is more expensive?
There can be a price difference online as well. The quick quote you receive can be different to the final quote you receive after answering all the extra questions.
Insurance companies have access to a huge claims database that may have involved your car (even if you weren't at fault)
Curious, Do you or the other party need to have made a claim to be on the database?
For example would it be safe to assume that if you didnt make the claim and decided to reslove it with the other party privately that would mean you wouldnt be on the database?
If you pretend to be a new customer you find out the loyalty penalty!
Allot of them ask if you had an insurance claim and then ask if it was your fault. If you lie to this question then the insurance company could use this against you and not payout a claim as you lied.
In your case I would ring the insurance company if you want to stay with them and ask them why there is a difference and see what they say.
Shop around for a better price. Even try to haggle with your current insurer, most will drop a few dollars for your business.
Shopped around and they are the cheapest, even with the increase. I'll try hagling…
Correlation does not imply causation.
Could just be insurance company way of dealing with inflation.
I had same question when I just renewed. How does it make sense that I have to disclose that someone hit me, and then their insurance paid to replace my car…? That doesn't make me a risk
But why did someone hit you? Maybe your driving is erratic, and you create dangerous situations for others. I know it sounds ridiculous, but that's how they evaluate risks.
Pretty sure you will find it is common practice to increase your premium for any "no-fault" claim
You are right. Just did 2 online quotes. One with 'no claim' and the other with a 'claim but not at fault'. The difference between the 2 was $65.
Unfortunately you are correct.
Statistically they've worked out that having a no-fault accident will increase the odds of another in the future, so they will increase premiums. Exactly why this would be I don't know.
About 4 years ago I received my renewal. Between receipt of renewal and actual renewal I had some idiot hit me head on in a suburban street around the corner from home in one of my other cars, insured with a different insurer.
At renewal, I advised my insurer I had an not at fault accident and they kindly increased my premium. I actually raised a complaint that went through the whole process with no success.
Unfortunately you can’t win.
Quotes are bullshit. I was doing one with AAMI the other day, and quotes were varying between $800-$1400!
Each time I did it on an incognito mode, connected through VPN. Tried different laptops (both Mac and pc) and different phones
Eventually, I called up about something and they managed to quote me $700!!
$65 is a pretty small increase so well done. I've had mine go up much more from no fault claim.
You also lose any no claim bonus you may have with the insurer. Which sucks cos again not your fault.
"Although it is not your fault but you might have contributed to the accident. The shape and colour of your car has a higher risk of being in an accident according to our proprietary risk model which we keep in our secret vault somewhere in the north pole. As such, the increase of $65 compensates us for this risk."
…Thanks, your favourite insurer.
sums it up pretty well.
I love the flexibility of the 'no fault' definition. A sane person would think that means 'if I can prove it is not my fault' then you'd be fine. But the real definition is 'it's your fault unless you have the name, address, blood type, name of first pet and current political affiliation of the other person'.
If you tried to lie to the insurance company they would employ teams of investigators to catch you out, but for a hit and run well that's not their problem.
Can go a step further and use my example where I had a NaF incident (Total repair cost - $1200, car owned and insured only by myself but I live with parents).
My premium went up slightly the next year which I thought was unfair but expected.When renewing dad's car, the premium went up a suspicious amount (Covid tax inflated its value so attributed a fair chunk to that), so started playing around and used both the neighbours address and the house opposite ours and it went down $80 (Note: the accident happened about 10km away from home and was a simple rear-ender (everything else in the quote was constant).
Called up the insurer (same as one as myself) and asked why there was a cost premium for my dad's policy when I had the accident (they had no affiliation other than residential address) and they hung up. Luckily we've otherwise had good experiences with them and with dad being a policyholder for other 20 years the discounts brought it to within $100 of cheapo (budget direct/bingle) insurers so we stuck with them but it still left a salty taste in my mouth.I should've just taken the cash offer from the other party at the scene and called it a day. Dad's premium has since gone back down to around what it was in 2019, at a slightly lower agreed value than it was then
Sounds like one of the dubious "budget" insurers.
Good insurers don't use it as a rating factor and I would questions how it increases risk considering you have no fault in the claim and they've presumably recovered the cost from the other party or insurer.
By and large, people don't understand how insurance or premiums work and I don't blame them, they can be hard to understand.
Challenge the insurer to explain how this increases the risk, but then odd premium increases aren't the worst thing you'll have to swallow with those insurers.
It goes up due to how many claims in your area, cost of parts and also car values increasing..
How do you know it was that event that resulted in premium increase?
There are a shit load more factors.